US helps unions muscle into
Bangladesh By Tabibul Islam
DHAKA - Under pressure from the United States,
trade unions will finally be allowed in Bangladesh's
export processing zones (EPZs) in January, a step hailed
as a victory by labor rights campaigners, but regarded
by some government and business leaders as bad for
The decision means that trade union
activities will be allowed more than 20 years after the
first EPZ opened near the port city of Chittagong,
offering foreign investors incentives that included a
bar on trade union activities. Unions demanding better
pay and working conditions was considered a costly
disincentive to business.
government decided in early December to lift the ban in
its six export zones, where more than 130,700 people are
employed. The move was taken under pressure from the US
government. Although the decision has been made, the
debate is far from over.
Critics say that many
unions are corrupt, cause trouble, do not actually help
workers and raise the costs of doing business in
Bangladesh, which is heavily dependent on garment
exports from the special zones.
leader Mukhlesur Rahman argues that it is high time that
trade unions operated in the EPZs. After all, he says,
Bangladesh's own laws, not to mention International
Labor Organization conventions, permit the right to
association in almost all spheres of national life. "The
law ought to apply equally to all sectors of the
economy, including the EPZs," he observed.
Reza Haider, president of the United Garment Workers
Federation, says the truth is that the Bangladesh Export
Processing Zones Authority (BEPZA), which oversees the
export zones, had become a government within the
government over the years.
But an investor from
South Korea, the largest investor in the zones, sees a
completely different picture. Foreign investors are like
migratory birds, he said, speaking on the condition of
anonymity. "We will settle where the condition for
investment is ideal," he said. "With the decision of the
Bangladesh government to allow trade unions in EPZs, we
foresee trouble, we feel insecure."
and Japanese diplomats also had protested Dhaka's
acquiescing to US demands. In October, Bangladesh had
asked the US Trade Representative's Office for three
more years before allowing trade unions to operate in
The debate over giving employees
freedom to organize in the zones, which account for much
of Bangladesh's exports, such as garments, has been
simmering for a decade. Long ago the American Federation
of Labor Institute had called for union organizing in
Bangladesh and its export zones.
concerns raised by some foreign investors, an official
with the BEPZA said that giving in to US pressure would
bring bigger benefits, especially more US investments.
Allowing trade union activities also staved off the
possibility of Washington imposing non-tariff barriers
on Bangladesh goods. This could have meant suspension of
the Generalized System of Preference (GSP) facilities,
if Dhaka failed to establish the right of labor
association in the EPZs from January 2004.
market crucial to Bangladesh The US market is
crucial to Bangladesh since it is the single largest
buyer of Bangladesh goods and services, taking in 36
percent of the South Asian nation's exports. Under the
GSP, Bangladesh's exports to US markets fetch about
US$40 million annually. US firms have invested about $31
million in the EPZs.
More than 20 countries have
invested a total of $674.54 million in 190 industrial
units in the zones. The biggest investor, South Korea,
has poured in $215.14 million and employs 55,326 people,
according to official statistics. Foreign investment of
$103 million in fiscal 2002-2003 is the highest ever
since the zones were established 20 years ago.
But now a number of top industrialists are
concerned about the labor situation next year in the
zones. An executive of one company, giving his name only
as Rahman, told IPS that trade unions in Bangladesh
often serve political groups and owners. "In this
impoverished country, a trade union is actually the
union of trade union leaders and not workers," he said.
"The labor leaders exploit both the workers and owners
of mills and industrial units for their personal
aggrandizement and personal gains. They use workers as
means to serve their selfish interests."
the issue, advocate Abu Ahmed of the Dhaka Bar
Association says that while trade union organizing was
conceived with the noble idea of safeguarding workers'
interests, this was not always the case in the country.
"In Bangladesh, trade unionism has become synonymous
with corruption of the trade union leaders, exploitation
of the workers, unrest in mills and factories and
hampering of production," he said. He recalled how over
two dozen jute mills, including the Adamjee Jute Mills,
the largest in Asia, had to be shut down after incurring
heavy losses over the years due to frequent strikes and
"Look at the Chittagong
seaport, look at the public sector banks, especially the
Central Bank, Power Development Board, Telephone and
Telegraph Board and other government organizations,
where strikes or the threat to strike on different pleas
and uneasy situations have become the order of the day,"
remarked Saiful Haque, a senior officer of a
nationalized bank in the capital.
Bangladesh Employers Federation says that the government
must see to it that outsiders do not get involved in
trade union activities in the export zones. Haider of
the garment workers' federation, however, cites a lack
of recognition that trade unionism is a basic right that
should have been available in the export zones in the
first place, so that restoring it now is not a
The question of extending better
wages, benefits and working conditions should not depend
on the pleasure of the employers alone, he adds. "These
issues should be governed by the rules and regulations
of a factory or industrial unit."
knowing they can assert their rights is also a plus
factor in business, argues Haider. Granting trade
unionism would spur workers to work more vigorously to
earn more money and this, in turn, would enable
entrepreneurs to make more as well.
Dec 18, 2003
material from Asia Times Online may be republished in any form without written
2003, Asia Times Online, 4305 Far East Finance Centre, 16 Harcourt Rd,
Central, Hong Kong